Nintendo 2006 Annual Report Download - page 27

25 Nintendo Co., Ltd. and consolidated subsidiaries
A. Principles of Consolidation
The accompanying consolidated financial statements include the accounts of the Company and all of its subsidiaries (total 20
in 2006 and 19 in 2005) except for 1 in 2006 and 2 in 2005. The equity method of accounting has been applied to 7 affiliates
(out of 8 in 2006 and out of 9 in 2005). The remaining subsidiary and affiliate are immaterial and investments in them are
carried at cost in the accompanying consolidated balance sheets.
The principal consolidated subsidiaries and the principal affiliate for which the equity method of accounting was used for the
year ended March 31, 2006 were as follows:
The amount of consolidated adjustment account is fully amortized in the same fiscal year as incurred.
Valuations of assets and liabilities of consolidated subsidiaries are under market price method.
All significant intercompany transactions, accounts and unrealized profits have been eliminated in consolidation.
The amounts of certain subsidiaries and affiliates have been included on the basis of fiscal periods ended within three months
prior to March 31.
Note 2. Significant Accounting Policies
The accompanying consolidated financial statements are prepared from the consolidated financial statements issued in Japan
for domestic reporting purposes. Nintendo Co., Ltd. (the “Company”) and its subsidiaries in Japan maintain their accounts and
records in accordance with the provisions set forth in the Japanese Commercial Code and the Securities and Exchange Law, and
in conformity with generally accepted accounting principles and practices in Japan, which are different in certain respects from
the application and disclosure requirements of International Financial Reporting Standards. Its overseas consolidated subsidiaries
maintain their accounts in conformity with the generally accepted accounting principles and practices prevailing in the
respective countries of domicile and no adjustment has been made to their financial statements in consolidation to the extent
that significant differences do not occur, as allowed under the generally accepted accounting principles and practices in Japan.
The consolidated financial statements are not intended to present the consolidated financial position, results of operations
and cash flows in accordance with accounting principles and practices generally accepted in countries and jurisdictions other
than Japan.
In preparing the accompanying consolidated financial statements, certain reclassifications have been made to the consolidated
financial statements issued domestically in order to present them in a form which is more familiar to readers outside Japan.
The consolidated financial statements presented herein are stated in Japanese yen, the currency of the country in which the
Company is incorporated and operates. The translations of Japanese yen amounts into U.S. dollar amounts are included solely
for the convenience of readers outside Japan and have been made at the rate of ¥117 to US$1, the approximate rate of
exchange at March 31, 2006. These translations should not be construed as representations that the Japanese yen amounts
have been, could have been or could in the future be, converted into U.S. dollars at this or any other rate of exchange.
Note 1. Basis of Presenting Consolidated Financial Statements
Nintendo of America Inc.
Nintendo Benelux B.V.
Nintendo España, S.A.
Nintendo France S.A.R.L.
Nintendo Australia Pty. Ltd.
Nintendo of Canada Ltd.
Nintendo of Europe GmbH
Consolidated subsidiaries
Affiliate
The Pokémon Company
Years ended March 31, 2006 and 2005
Notes to Consolidated Financial Statements